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Economy of Izmir


İzmir known as the modern face of the Anatolian and the gate opening to the west has been hosting different religions and civilizations for centuries. It holds the particularity of being a city of tolerance due to the cultural variety that it has carried until today.

İzmir comes upon the cities that contribute the most to the Turkish economy thanks to her economic size.

İzmir competes not only within Turkey but also with her competitors at global scale. İzmir is indicated as the second rising economy among 300 cities in 2014 according to the “Global Metro Monitor 2014” report prepared by the Brooking Institute and JP Morgan Chase.

By 2017 İzmir is the third biggest city of Turkey after İstanbul and Ankara with her population of 4.279.677. There are 2.133.548 men and 2.146.19 women living in İzmir.

Population growth in the city is 1,32% in 2016-2017 period.

While 122.700 persons immigrated to İzmir in 2015-2016 period, 98.900 persons emigrated from the city.

Number of persons per square metre in İzmir is 356 by 2017 and the average household size is 3,04.

İzmir has 30 districts.

Trade, industry and tourism are intense in centre districts where population is concentrated while in districts more distant to the centre agriculture and breeding is intensive and in coast line centres tourism is dense.

İzmir is among the economies that contribute the most to the country’s economy. İzmir took 6,23% of Turkish economy within the Gross Added Value perspective in 2014 and the GDP per capita is 14.257$.

While there are intensive trade activities in the city centre; small industry sites, organized industry zones, free zones and techno parks also contribute to the development of the city industry. Markets located in the city centre of İzmir, commercial sites and shopping centres are intensive trade areas of the city.

İzmir disbursed 63 billion TL tax payment. It is one of the highest tax paying cities.

Table 1: İzmir Macro Economic Data

 

2013

2014

2015

2016

2017

Unemployment Rate (%)

15,4

13,9

15,0

14,0

---

Number of Unemployed (Thousand Persons)

276

243

262

254

---

Employment Level (Thousand Persons)

1.514

1.504

1.483

1.566

---

Employment Rate (%)

47,3

46,1

45,4

47,6

---

Public Investments (Million TL)

1.209

1.476

1.639

1.763

2.751*

Subsidized Fixed Investment Amount (Million TL)

1.789

4.344

3.438

1.858

7.560

(January-December  2017)

Number of Company Established

(Cooperatives not included)

5.400

7.010

6.190

6.186

7.010

(January-December  2017)

Number of Company Closed

(Liquidation not included)

2.085

2.038

1.455

1.378

1.607

(January-December  2017)

Collection of Tax Incomes (Billion TL)

36,3

39,8

48,3

52,3

63,0

(January-December  2017)

Total Bank Deposits (Billion TL)

48,6

54,7

64,6

76,9

85,9

(September 2017)

Total Bank Cash Credits (Billion TL)

60,2

66,9

77,9

85,8

104,3

(September 2017)

Number of Bank Branch Offices

826

837

824

785

773

(September 2017)

Number of Companies with Foreign Capital

(1954- Cumulative)

 

2.110

2.229

2.422

 

 2.553

(November 2017)

Source: Turkish Statistics Institute, Ministry of Economy, Ministry of Finance, Ministry of Development, Banking Regulation and Supervision Agency, the Union of Chambers and Commodity Exchanges of Turkey Statistics, 2017

*Planned amount

Agriculture, breeding, fishery, navigation, whole retail trade, tourism, logistics and energy sectors are the sectors that are prominent in terms of investment in İzmir’s economy.

İzmir possesses almost all kind of tourism opportunities from yacht tourism, congress tourism, and faith tourism to cruise tourism.

Besides İzmir also shelters the potential to become the centre of health tourism in the world with its rich geo-thermal sources and hot springs. Izmir is a city that has rich renewable energy sources especially wind, geo-thermal and solar energies can be used in the city.

İzmir has always been into prominence as an important trade centre with its particularity of being a port city at all times in her history. Izmir nowadays is a centre for many economic activities because of many advantages such as fertile lands, qualified work force structure, sources of raw materials and intermediate products, suitable climatic conditions, developed port and logistic infrastructure, environment focusing on foreign trade and its proximity to domestic and foreign markets.

Ports have an important share in İzmir’s foreign trade.

According to the 2017 January - November calculations based on companies tax identity numbers; İzmir’s exports is 8,4 billion Dollars and its imports is 8,9 billion dollars.

According to the “The World’s Most Competitive Cities” report prepared by the American Conway Inc.; the producer of the Site Selection Magazine; which is considered as one of world’s most important publications established in 1954, İzmir took place among the world’s top competitive cities of East Europe and Middle Asia in 2015 in aero-space, chemical-plastic and energy sectors.

According to the report, İzmir is:

  • The most competitive city in aero-space sectors,
  • The most 3rd competitive city in the same region in chemical and plastic sectors,
  • The most 3rd competitive city in energy sector.

It is expressed in the report that İzmir raised into prominence as;

  • İzmir would grow highly in the next 5 years,
  • It is the second trade centre of Turkey,
  • It realized 9,3% of Turkey’s industrial production,
  • It has a young and dynamic population of 4 million,
  • It hosts big scale investments of companies such as Socar (4,8 billion Dollars of investment), Pratt & Whitney (75 billion Dollars of investment), Deceuninck (28 billion Dollars of investment), Abengoa/Befesa (industrial waste treatment and recycling activity) .

İzmir appears day by day in many more foreign research companies’ reports.

This fact indicates that opportunities that İzmir provides to investors are increasing.

İzmir’s successes would increase incrementally if İzmir gets more share from the subsidy system and if İzmir’s exporters can compete in equal condition with their competitors abroad.

İzmir’s future is bright if potentials of İzmir’s renewable energy, chemical-plastic, aero-space, tourism, organic farming, food, beverages and agro-industry, ready wear, textile and apparel, automotive and logistic are used well.

To this end, the followings are needed:

  • the completion of big transportation investments such as İzmir-İstanbul Highway, İzmir-Ankara High Speed Train Line, İzmir Çandarlı Port and the  “İzmir Gulf Transition Project” that would connect the North and the South of İzmir,
  • the amelioration of business environment in İzmir,
  • the realization of more international exhibitions and congresses,
  • the increase of direct flights from İzmir to main centres abroad and
  • the creation of more employment possibilities according to İzmir’s qualified work force.

 

For More Information:

Erdem Alptekin - Şebnem Boran - Hande Uzunoğlu

Research, Entrepreneurship and Development of Professions Department

Experts

Tel   : (232) 498 41 44 - 498 43 05- 498 42 27

Fax: (232) 498 46 35

E-mail: erdem.alptekin@izto.org.tr; sebnem.boran@izto.org.trhande.uzunoglu@izto.org.tr